Music website The A.V. Club has a great little project going on. They came up with 25 classic songs and had 25 different bands/solo performers go into a small room to play them one-by-one.
I particularly love the Fruit Bats' version (below) of "One on One" by Hall and Oates. Not many can pull that off!
Also check out Superchunk covering The Cure and Ben Folds nailing an Elliot Smith tune.